Pimco's Fels Sees Value Emerging in Credit But Says It's Not Yet Time to Buy

The transcript discusses the shift in recession risks from consumer to corporate balance sheets, highlighting PIMCO's cautious approach to corporate credit due to concerns about leverage and economic slowdown. Despite some emerging value in the market, PIMCO remains underweight, waiting for better opportunities as spreads widen.

What was the primary driver of the 2008-2009 recession?

• International trade

• Government policies

• Consumer balance sheet

• Corporate balance sheet

Why has PIMCO been underweight in corporate credit?

• Lack of investment opportunities

• Concerns about corporate leverage

• Strong economic growth

• Due to high interest rates

What type of companies are particularly concerning for PIMCO?

• Cyclical companies

• Tech companies

• Government-owned companies

• Startups

What is PIMCO's current stance on corporate credit investment?

• Reducing all investments

• Focusing on government bonds

• Aggressively investing

• Waiting for further spread widening

What does PIMCO see emerging in the corporate credit market?

• Higher interest rates

• Emerging value

• New regulations

• Increased risks